Hampton Company is considering the addition of a new product to its cosmetics line. The company has three distinctly different options: a skin cream, a bath , or a hair coloring gel. Relevant information and budgeted annual income statements for each of the products follow Relevant Infornation 120,000 216,000 Expected salea price (b) variable costa per unit(c) Income statements Gales revenue (a b) Variable costs taxc) Contribution margin $ 7.00 400 10.00 6.00 2.00 $ 1.00 $ 840.000 864,000 720.000 240,000216,000-932,0001 480,00 120.000 540,000)(120,000) 108,000 168,000 - Net ineone Required a. Determine the margin of safety as a percentage for each product b. Prepare revised income statements for each product, assuming a 25 percent increase in the budgeted sales volume. c. For each product, determine the percentage change in net income that results from the 25 percent increase in sales. d. Assuming that management is pessimistic and risk averse, which product should the company add to its cosmetics line? e. Assuming that management is optimistic and risk aggressive, which product should the company add to its cosmetics line? Skin Cream a. Bath Oil Color Gel Sales price (a) Variable costs b Contribution margin (c)(a b) Fixed costs (d) Break-even units (e (dC Break-even sales in $(f) (e x a)$ Budgeted sales in units (g Budgeted sales in S(h) n(gx a)S Margin of safety (h -fh Rounded Skin Cream Bath OilColor Gel Expected sales in units (a Expected sales price (b $ Variable costs per unit (c) $ Income Statements Sales revenue (a x b Variable costs (a x c) Contribution margin Fixed cost Net income Skin Cream C. Bath Oil Color Gel Income before growth aS Income after arowth (bl % Change in income (b-a) a Rounded